Trump’s War On Retail Keeps Getting Worse

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It has been said that old-timers working in the retail trade prefer to be seen and not heard. Even in the midst of America’s rising mass retail thievery crisis, they would prefer that others (like trade associations) do the talking. With that being said, it was only a few months ago when David Johnston of the National Retail Federation commented: “We are living in a nation where stealing is no longer considered a crime, and those stealing are not criminals.” In year 2022, it was reported that losses from retail theft hit the enormous number of $112 billion for the industry.

Given the preferred low key profile of retailers, it was still quite a surprise when former President Trump remarked that if he were to serve another next term, his administration would handle retail theft very aggressively. He was quoted as saying: “We will immediately stop all the pillaging and theft. Very simply: If you rob a store, you can fully expect to be shot as you are leaving that store. Shot!”

The former President’s comment was both shocking and painful for an industry that works hard to be consumer friendly but, as with other Trumpian proclamations, most observers paint his banter as bravado, even though it demonstrates how retail theft has now been politicized. For those in the retail world who interacted with the former President when he was in office, many would characterize his actions over four years as being somewhat against retail and very difficult on trade. In fact, it’s easy to conjecture that he probably doesn’t like the retail space, as his actions over time have created havoc for those who participate.

Probably, the first signs of an aversion to retail began on June 16, 2015 when Mr. Trump and Melania boarded the down escalator in Trump Tower for the ride that never ended. On that day, Mr. Trump delivered his first blistering speech as a candidate, and the war on retail was in motion. It was the department store Macy’s who fired the first salvo, by throwing Trump apparel products out of the store because he had made disparaging characterizations about Mexicans, Mexican Americans, and Latinos. Nordstrom soon followed by tossing daughter Ivanka’s fashion lines out of their product mix, saying that it was based on the brand’s performance. Trump’s reaction was to rail against both companies. On July 11, 2015 Mr. Trump took to Twitter and said “that people who believed in border security, halting illegal immigration, and better trade deals should boycott Macy’s.” On February 8, 2017 – Mr. Trump took to Twitter again and said that “his daughter had been treated unfairly by Nordstrom.”

It is also important to remember that Donald J. Trump was once an aspiring retail fashionista (although some will say that he was just in it for the royalty income). Mr. Trump, along with his daughter Ivanka, initially charmed the retail fashion industry. Mr. Trump’s name became a fixture on men’s shirts, ties, and suits at Macy’s and Ivanka had an impressive footwear and fashion company. Melania, for her part, was touting jewelry on QVC.

Candidate Trump was very pro-business, so most retailers (at the time) were not very alarmed by the Macy’s and Nordstrom distraction. In general, retailers were hoping for a better tax environment under a Trump Administration, and for improved international trade deals. On the campaign trail, candidate Trump found it was popular to skewer President Obama’s long negotiated Trans-Pacific Partnership (TPP). After Candidate Trump won the election, by his third day in office he abruptly ended USA participation in the finalization of the TPP. Now, as the former President looks to win a second term, he has targeted President Biden’s Indo-Pacific Economic Framework (IPEF) – which he recently called “TPP Two” and Trump’s plan is that will also be dead-on-arrival, should he become President #47.

If IPEF were to disappear, most retailers probably wouldn’t be upset – simply because IFEP doesn’t really have a cross-border trade component that would help to increase business. However, per the Trump campaign, IPEF apparently sounds like an excellent political spin item – even though it is only a trade facilitation bill. On November 18, 2023 in Fort Dodge, Iowa, the former President said: “Under the next Administration….the Biden Plan for ‘TPP Two’ will be dead on day one.”

The former President also said that he wanted to add 10% tariffs on everything that is imported into the USA . He recently indicated: “I think we should have a ring around the collar of the U.S. economy.” While his latest proposed tariff and other trade initiatives are not necessarily retail friendly, the former President, to his credit, was successful when he renegotiated NAFTA to become USMCA (United States-Mexico-Canada Agreement). He also stopped the Border Adjustment Tax (BAT tax) that was put in play by former Speaker of the House Paul Ryan.

Looking back in retail time is much easier than looking forward. It is well known that retail inflation and global supply chains were disrupted by COVID-19, but it is also clear that former President Trump was responsible for the four tranches of tariffs against China – that directly led to the failed United States-China Phase One Trade Agreement. From a consumer perspective, everyone understands that prices of apparel, footwear, and accessories have increased dramatically since the former President left office – but China trade on these products is still by far the largest source of supply – which only proves the point that the tariffs didn’t solve any of the problems, they just helped create new ones.

In March of 2020 as COVID-19 was overwhelming America, President Trump was advised that some retail stores would need to close, and most everyone believes that was the proper action to take. However, retailers who were close to the Administration at the time (like Walmart and Target) were allowed to stay open because, in addition to clothing, they carried food products and maintained pharmacies. The optics of their status was interesting, because in August of 2018, the former President tweeted that The Target CEO had praised the economy, and in August of 2019 he tweeted that Walmart was an excellent example of how the U.S. economy was prospering. In March of 2020, both the Walmart CEO and the Target CEO appeared win the Rose Garden with President Trump as an example of two great companies that would help in the fight against COVID-19. Other, non-essential retailers would likely have to close.

When the actual list of essential and non-essential industries was released in March of 2020, it was interesting for retailers to see who made the essential category and who was considered non-essential. Gun shops, shooting ranges, grocery stores, pharmacies, and liquor stores were quickly listed as essential businesses and could stay open during the lock-down. If you only sold apparel or only footwear or only accessories – you were destined to close. Some found it amazing that you could buy a gun during the COVID-19 and head to a shooting range but, it you needed a cashmere sweater, socks, or underwear – that would be a challenge to acquire.

In Trump World, it is always hard to guess what might happen next. Given the current stated potential of additional retail tariffs, or dealing with the current rash of retail theft, or the disruptions of re-negotiating trade deals, or further interference with China commerce – if the former President were to get re-elected – just about anything could happen. At this point in the 2024 Presidential campaign – the Trumpian War on Retail is far from over and probably just beginning. Things could get better or they could get worse.

Now is a good time for consumers of retail product to remember – Caveat Emptor.

Let the buyer beware.

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